Advertising growth helps Trinity Mirror to hit targets

Newspaper publisher Trinity Mirror said its 2007 performance would be in line with expectations after underlying advertising revenues increased marginally for the 10 months to the end of October.

"While the advertising environment remains volatile month on month we are encouraged by the trends that are emerging," said finance director Vijay Vaghela.

In a trading update, he stated: "As we indicated at the interim results we have experienced a gradual improvement in advertising market conditions.

"The board is confident that our 2007 performance will be in line with our expectations."

Group advertising revenues excluding businesses disposed of and including all acquisitions on a like-for-like basis increased by 0.1 per cent.

This reflected a decline of 1.5 per cent for the first half and an increase of 2.7 per cent for the four months to October.

Advertising revenue in the regionals division remained flat for the 10 months to October, compared to a decline of one per cent for the first half. Nationals division advertising revenues increased by 0.9 per cent overall against a decline of 2.3 per cent for the first half.

Group circulation revenues excluding disposed businesses increased by 0.8 per cent. Circulation revenues increased by 0.6 per cent for the regionals and 0.9 per cent for the nationals.

Mr Vaghela said: "The development of our strategic goal, to build a growing multi-platform media business, is progressing via the launch of new products and services, acquisitions and the implementation of improved technology platforms."

The company, which owns The Birmingham Post and Birmingham Mail, will announce next month how much surplus capital will be available to shareholders following recent disposals.

It will next update the market in its pre close trading statement on December 13.

Analysts at Numis said the update should provide considerable comfort to investors.

"The newspaper companies have experienced a sharp sell off in recent weeks, reflecting cyclical and structural uncertainties," they said. "We believe this update should provide comfort to investors and, with Trinity Mirror shares trading on a 2007 PE of 8.2x, our recommendation is Add."